tagged w/ Credit Crisis
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A leaked letter from the Home Office to Gordon Brown admits the ailing economy is about to fuel a rise in extremism and crime.
The document outlines how people becoming poorer will fuel resentment of immigrants as job competition stiffens.
The letter states: "There is a risk of a downturn increasing the appeal of far-right extremism and racism, which presents a threat as there is evidence that grievances based on experiencing racism are one of the factors that can lead to people becoming terrorists."
The leaked dossier also sets out the potential for an increase in violent offences caused by the credit crunch and soaring food prices.
Although data for last year showed crime falling by 10% overall, they pointed out that during the 1992 slump violent crime rose by 19%.
Particular "upward pressure" would be exerted on levels of property crime, such as burglary and car break-ins.
Police forces may have to protect finances by holding back parts of their budgets.
This could leave them facing "difficult decisions over officer numbers and priorities".
Furthermore, falling revenue from visa applications will also put activities at the Border Agency "under pressure".
Smuggling and illegal working is expected to rise as employers seek to "save costs".
Officials at the department examined previous periods of negative economic growth to come to their conclusions.
The Home Office is due to deliver the stark assessment to Gordon Brown amid fears that Britain is heading for recession.
The Tories said the document demonstrated that ministers had been "complacent".
A Home Office spokesman said: "It is... appropriate that the Home Office considers the effects the economic climate may have on crime and other policy areas.
"We are confident that we have the right systems in place to respond."
A leaked letter from the Home Office to Gordon Brown admits the ailing economy is... more
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It is the city the credit crunch forgot. The rest of the UK may be feeling the pinch, but life is good in Aberdeen, the oil capital of Europe.
World energy prices are soaring with Brent Crude now trading at the once unimaginable figure of $120 a barrel.
The oil industry is booming and as a result Aberdeen and its residents are enjoying a prosperity not seen since the 1970s.
Trade is as brisk as ever at the city's best-known restaurant the Silver Darling.
Owner and chef Didier Dejeun says the credit crunch is having no effect here at all.
He said: "All the oil executives and their families are based here, they have to spend their money somewhere and they spend it in Aberdeen.
"There is no limit to how much some people will spend. They arrive at the restaurant in their Ferraris and their Bentleys and order champagne."
The five-star Marcliffe Hotel and Spa is situated in the Pitfodels area of the city, which boasts the highest proportion of millionaires anywhere outside London.
Owner Stewart Spence says the hotel has never been so busy and customers are still willing to spend money on life's luxuries.
He said: "Aberdeen is basically all about energy and the price of oil worldwide means more employment and exploration, which all comes back to the city.
"People's spending habits haven't changed at all. Customers are still asking for the best wines and the lobster."
But some believe Aberdeen cannot buck the trend forever and that the big companies like Shell and BP will be unable to keep posting record breaking multi billion pound profits each quarter.
However, former Lord Provost and city councillor John Reynolds disagrees.
"The price of oil will not go down, it will get up to $150 maybe even $200 a barrel in two years time," he says.
"We will continue to benefit from that here."
The downside is that the people of Aberdeen will still have to pay the price at the pumps. For many though, that is a price worth paying.
It is the city the credit crunch forgot. The rest of the UK may be feeling the pinch,... more
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Everything conspires to force us to feed this way. Natural light, TV programming, the timing of theatre, film, opera performances and sporting events, all demand that we work during the day and eat and entertain ourselves at night. If I were dictator, I'd change it all. Would you?Everything conspires to force us to feed this way. Natural light, TV programming, the... more
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ORLANDO, Fla. -- Sen. Barack Obama suggested he could accept an expansion of offshore oil drilling today if it is in a broader package of energy measures that would free the logjam on energy bills in Congress.ORLANDO, Fla. -- Sen. Barack Obama suggested he could accept an expansion of offshore... more
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A derelict public toilet has defied the downturn in the housing market to sell for £34,500.
The single-storey, breeze-block building attracted interest from first-time buyers reportedly seeking a foothold on the property market.
Auctioneers said the purchase would allow the new owners to "let their imagination explore further possibilities".
The conveniences, in Bath, Somerset, were listed with a guide price of £10,000 but, after an intense period of bidding, the hammer eventually came down at £34,500.
The block is close to a row of shops and within a five-minute walk of the city centre.
A spokeswoman for auctioneers Breach Wood Ingram said: "Interest was particularly high in this sale.
"This was a rare opportunity in a stunning location and a truly unique chance to acquire a plot of land in a very sought-after area."
Is this the only kind of property most people could afford to buy these days? Have you seen property prices changing where you are, or been affected by rising or falling house values, whether you own or rent? And if you owned a toilet block, what exactly would you do with it?
A derelict public toilet has defied the downturn in the housing market to sell for... more
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The disaster of the housing market has been well documented. Not only are home being abandoned, as people find that payments are beyond their means, companies like Fannie Mae and Freddie Mac financial trouble that these mortgage companies are in need of government rescue. The people will shoulder the economic burden.
In striking contrast, the Chief Executive Officer of Freddie Mac will be just fine:
“NEW YORK - Freddie Mac Chairman and Chief Executive Richard Syron pocketed nearly $19.8 million in compensation last year, according to a Securities and Exchange Commission filing Friday, even though the mortgage company’s stock lost half its value in 2007.”
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What is wrong with this picture? People are losing their homes. Stock value plummets. And the CEO is able to bank tens of millions of dollars.
At the risk of falling in what Senator Gramm might call the “whiners” camp, this just isn’t right. The consequence of being major part of a financial debacle is to be awarded millions and millions of dollars. How can that be justified, in any manner?
Catherine ForsytheThe disaster of the housing market has been well documented. Not only are home being... more
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This week, with the nation’s financial infrastructure crumbling before our very eyes, the nation’s top two economic policy makers made their way to the Congress for an extraordinary episode of political theater. Fannie Mae and Freddie Mac, the quasi-government entities that form the backbone of America’s gargantuan mortgage market, appeared to be cracking. To the somewhat bewildered members of Congress, Ben Bernanke and Henry Paulson offered radical remedies to save the lenders. Despite the fact that the proposed policies would thoroughly redefine America’s supposedly capitalistic pedigree, the moves were presented as wholly inevitable, and in the end, benevolent and costless.
If you are looking for a new chapter in American history, it has just begun.
The most memorable moment in the episode came when Secretary Paulson explained that the best way to minimize the chances that Fannie Mae and Freddie Mac will need a government bailout would be for Congress to grant the Treasury unlimited authority to lend to the two institutions. His analogy: When the bad guys see a bazooka on your hip, you are less likely to be challenged to a gunfight...
... At present, the best the government can do for housing and the economy is to leave both alone, cease interference in the free market, restore sound money, and allow capitalism to work.
Unfortunately, the laws of capitalism are now demanding that home prices continue to fall precipitously. But, based on the speed in which our government, public and financial institutions are willing to abandoned free market principals at the first whiff of economic pain, the likelihood that this impulse will take hold is increasingly remote. So hunker down as the United States finds itself on the express track to state socialism with Paulson’s Bazooka locked, loaded and pointed right at us. When the government pulls the trigger the blast will blow the dollar, and what’s left of our capitalist economy, to smithereens."
(End of excerpt)
Full commentary "Armed and Dangerous" (July 18th, 2008) at link by Peter Schiff, President & Chief Global Strategist// Euro Pacific CapitalThis week, with the nation’s financial infrastructure crumbling before our very... more
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The Federal Reserve may extend into next year a facility that gives investment banks access to emergency cash if the financial turmoil persists.
The lending facility was put in place in March to stabilise the financial system as Bear Stearns collapsed.
Fed chairman Ben Bernanke also called on Congress to give the central bank more authority to supervise markets.
The Fed will issue new rules next week aimed at cracking down on dubious lending practices.
(End of excerpt)
Full article at link by BBC News
Photo: APThe Federal Reserve may extend into next year a facility that gives investment banks... more
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The Bank for International Settlements, the world's most prestigious financial body, has warned that years of loose monetary policy has fuelled a dangerous credit bubble, leaving the global economy more vulnerable to another 1930s-style slump than generally understood.
"Virtually nobody foresaw the Great Depression of the 1930s, or the crises which affected Japan and southeast Asia in the early and late 1990s. In fact, each downturn was preceded by a period of non-inflationary growth exuberant enough to lead many commentators to suggest that a 'new era' had arrived", said the bank.
The BIS, the ultimate bank of central bankers, pointed to a confluence a worrying signs, citing mass issuance of new-fangled credit instruments, soaring levels of household debt, extreme appetite for risk shown by investors, and entrenched imbalances in the world currency system.
(End of excerpt)
Full story at link by Ambrose Evans-Pritchard// Telegraph
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Image: Bank of International Settlements Headquarters by David Croll posted at Wikimedia Commons
http://en.wikipedia.org/wiki/Image:BankIntZahlungsausgleich.jpg
Licensed under GNU Free Documentation License
http://commons.wikimedia.org/wiki/Commons:GNU_Free_Documentation_License
The Bank for International Settlements, the world's most prestigious financial... more
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Since late 2004, the real estate market in Las Vegas has "crashed", down about 20% - 40% from its highs just a couple of years ago to pre-2004 prices in most areas. Over-building, exaggerated enthusiasm, bad mortgages, a terrible economy and huge FRAUD combined to create the perfect storm pressuring millions of homeowners to fold and lose big. These very sad times for millions are now causing increases in crime, and overwhelming physical and mental illnesses from stress. Here is an article typical of the Las Vegas Newspapers everyday lately.
Since late 2004, the real estate market in Las Vegas has "crashed", down... more
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Increasing amount of landlords in the UK hit by the credit crisis are having their properties repossessed.Increasing amount of landlords in the UK hit by the credit crisis are having their... more
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The International Monetary Fund said Tuesday that financial losses stemming from the U.S. mortgage crisis might approach $1 trillion, citing a "collective failure" to predict the breadth of the crisis.
Falling U.S. house prices and rising delinquencies may lead to $565 billion in mortgage-market losses, the IMF said in its annual Global Financial Stability report, released in Washington. Total losses, including the securities tied to commercial real estate and loans to consumers and companies, may reach $945 billion, the fund said.The International Monetary Fund said Tuesday that financial losses stemming from the... more
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